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there is no celebration, yet. I said in an earlier post that there will likely be additional gyrations and down moves before the end.
I just don't want disbanding going on.
Did you see the 250k block @ 15 for FMCCT on Friday?
Then you are the one who will organize it. We just need someone to do this thing. I don't want everyone saying "well, I have this or that to do...."
I have never been to Vegas. For me it will be "first Vegas", not "Last Vegas".....
This may drag out for six months to two years.....
Re: This Neverending Story
I plan on being in Vegas with y'all once it is done. I don't hear anyone talking about that, now. I am guessing it is because once "it happens", y'all will want to do your own things.
I plan on being there..... I nominate/appoint Camaro and T-Fud as the organizers. Since T-Fud isn't here to say no, (and has more free time than most of us) it is only fair!
anyone want to "second" the nomination?
Who am I to argue with Mark Twain? I do think he got it correct.
Also note that british comedies like "keeping up appearances" and "Mr. Bean" are hilarious and subtle the way Twain describes in american humor.(IMO)
is that who the airport is named after? NYC airport?
Also-
Are you accusing folks of counting money?
This was not a reco back then and isn't now....
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The end game
by josephslechta • Aug 18, 2012 4:51 PM
Re-post of what I typed 1-21-12
I know that everyone out on the board knows and understands this. The GSE paper (whether the gov't likes it or not) is backed by the full faith and credit of the USA. China(and foreigners in general) is/are the biggest buyers of both GSE's and US treasuries. The government can't allow the bonds in the GSE's go through the full receivership process needed without taking a hit to the face of the bonds. If the bonds take a hit, the US may be downgraded again by S&P. Worse, if foreigners don't have confidence, they may turn to other "paper" to buy. They can't pay face on that paper(GSE debt) at 100 without compensation to pref. and common holders in bankuptcy without violating laws. In Cship, we all know and understand the game, own this until bankruptcy or redemption(or a combination). We know how fragile the housing market is since none of us are super rich(or we live in pretty middle class neighborhoods). We understand that without the GSE's right now, lending for homes is shut off for 90%+ of the people out there. It isn't like GM, Ford and Chrysler were there are another 10 players to pick up the slack. The GSE's(whether the FHA, GNMA or FRE, FNM) are the only real lenders out there right now. It is all gov't or gov't backed. Without them, rates are much higher and loans require 20-40% down with a 10 year loan. My opinion is that either the government takes this over or they release them. It is such a simple trade yet we make it very complex. I own the preferreds in both but don't have an opinion on what others should do....
still own the preferreds. Not a reco to buy or sell. just an opinion.
"Who was ebano working for?":
ebano couldn't work his way out of a wet paper bag.
He may have made money but his logic needed help(way more than even Joe Stocks).
At least Joe Stocks knows how it all works and had added a couple of things from time to time. He is a negative Nellie is all.
Keep in mind, jealousy and anger at not holding on can change things. Of course we all can talk about wishes and buts.
If they were candy and nuts we would all be happy.
You guys are funny. He did get out due to his risk aversion.....
Now Ackman is below the preferreds in the cap structure.
Betting against Ackman or Ichan in the long run will do bad things to you.
based on capital structure(which is how I do it), that is correct. One other thing to keep in mind.... WNA-P(the wachovia Capital trust preferreds baked by real estate loans) traded down to 7-8 bucks even after the announcement that WFC was taking them over. Even if the real estate loans went bad, WFC was backstopping. They were paying divvies the whole time.($25 preferreds)
my point is:
Preferred shareholders are usually much more risk averse and will sell for just about any reason if they think things may go bad.
The divvies aren't restored, here. there may still be ups and downs to this(opportunities) before the end game is announced.
That is why I always check yahoo finance on Sunday night. Announcements of settlement/dividends/whatever will ultimately happen on a Sunday night.
Stock A-
This isn't over yet. Given that the gov't is saying "no comment" on proposals and is really quiet, they may be in negotiations with these "activist investors". Of course Ralph Nader will do a victory lap if this is ultimately settled.
Me either. You can lookup every post from the YMB(josephslechta@yahoo.com). josephslechta was my hanlde and still is. I rarely if ever posted. I never made recos on the stock(or any stock) but I talked a ton about capital structure and all of that to keep people centered in the/on the tough days. I got into it with a couple of illogical people(namely ebano) but have never strayed from watching and adding comments if the tone got too dark.
Me either. You can lookup every post from the YMB(josephslechta@yahoo.com). I never made recos on the stock(or any stock) but I talked a ton about capital structure and all of that to keep people centered in the/on the tough days. I got into it with a couple of illogical people(namely ebano) but have never strayed from watching and adding if the tone got too dark.
Pandering by the gov't is the fear. Like GM and the unions. Illegal that the bond holders were screwed. Glad I never bought the bonds. thought about it.
only if the gov't guarantee is preserved. Reid seems more about the status quo.
possibly.
OK. I am done for a while. Posting too much.
I know JPM and US Gov't are not interchangeable, too....
Although the gov't backstopped the deal
I also know the situations are not a perfect match....
We'll see. During Bear Stearns, once they upped the bid from a dollar to 10(I think) and voted on it, it stopped most of the possible litigation. Shareholders/stakeholders will probably vote on any proposal. It will not be unilateral.(IMO)
My guess is our arrogant and dysfunctional government will ignore or ridicule the proposal while declaring their supreme right to do whatever they want. Yup, sounds about right.
Agree. They will say this publicly. privately they may be thinking of trying to make some kind of a bargain/deal.
treasury/admin will want all lawsuits dropped.
This is settlement fodder, too. Treasury and the administration won't do anything unless everyone signs off on a settlement. That I know and can say without making any recos....
I can't really talk much about it except generalities. I will be in Vegas, though. I will buy one round(and one round only)
this is a starting point and a way to prove a point as well. It is the way it is done on Wall Street.
These are hedge funds. They know the stock market and how to make money. Of course, they are doing what the this guy did:
This reminds me of reading about the first time Colonel Sanders figured out how to cook chicken faster and patented the process. He eventually sold the process to KFC while living in his car. The rest is history.
Of course I am referring to the position the gov't is in. The 'ol pressure cooker.
Is it getting hot in here, or did this just get more interesting. Notice that if someone owns half(or a consortium), there isn't much float. Talk about more pressure......
true. I don't care. it is just stupidity of the talking heads. still glad you posted it
enough posting for me. Just got fired up at the conjecture on a tender for preferred shares(as if it is "fair and just". Not to say the company won't offer a conversion like Citi did. It will be a choice, though....
As is typical, these people from academia backgrounds don't understand that FNF are privately owned @ 20.1% at least assuming warrant conversion. (although as we know the gov't has a huge warrant stake.)
all of these academic types act as if it is currently in receivership.
thanks for posting. over time, I have noticed more and more are recognizing it is still technically private but under gov't control.
You do not understand. you need to research and understand "rule of law", "legal precedent" and the facts of this particular situation. The best example of precedent is the railroads taken into conservatorship in the early 1900's. the rails weren't forced into receivership and neither was FNF.
please research before you post conjecture, friend.
On December 26, 1917, President Woodrow Wilson finally proclaimed: "I have exercised the powers over the transportation system of the country, which were granted me by the act of Congress of last August, because it has become imperatively necessary for me to do so." He addressed Congress just a few days later, on January 4, 1918, telling all assembled that he had exercised this power "not because of any dereliction on their [the Railroads' War Board's] part, but only because there were some things which the government can do and private management cannot."
1917:
The United States formally enters World War I. The federal government assumes control of American railroads as a wartime measure on December 28.
1918:
Armistice is signed on November 11. U.S. Railway Administration Director-General advocates five-year "test" of government control.
1919:
President Wilson announces that railroads will be returned to private control within a year.
Ultimately, government operation of the railroads may have been satisfactory from an operational point of view, but it was a financial disaster. It also violated American business ideology, and the general public by war's end was in the mood for a return to normalcy. Although a number of labor and other interests agitated for federal purchase and continuing control of railroads following the end of hostilities, this was not to be. The Transportation Act of 1920 returned the railroads to their owners as of March 1 of that year.
The Act greatly increased the power and scope of the Interstate Commerce Commission, while at the same time directed the Commission to prepare plans for the formal consolidation of railroads into a limited number of systems. Unfortunately, the Transportation Act seems largely to have ignored the fact that there were new forms of transportation on the horizon.
These are my words now:
"The people who invested in the shares at the greatest times of uncertainty made a fortune."
Don't fool yourself into believing that the former solicitor general(Mr. Olson) who has tried 56 or so cases in front of the supreme court doesn't know these facts. he has tried liberal and conservative cases. He doesn't care as long as the law is on his side. It is about win baby, win.... We are a nation of laws, not tyranny.
ok. that was enough posting for me. I am going to observe again.... sorry for the interruption!!!
someone posted it out here on Sunday right away. Huge change and first major firm to come out with anything like this. Since Merrill is up there with MS and GS, I thought it was important, too. huge change from previous consensus of: "this is a zombie that will never come back"
Also on page 21 of the document:
Paying the federal government all profits earned in a quarter might prevent the GSEs from
accumulating funds to redeem the senior preferred stock. However, if this payment applies only at
the end of a quarter, it would appear that the GSEs could redeem some senior preferred stock
using funds available before the end of each quarter. This would be a way the GSEs could return
to stockholder control, although it would likely take many years. FHFA could prevent (or
authorize) this redemption of senior preferred stock
http://www.fas.org/sgp/crs/misc/R42760.pdf
pure insanity how attorneys parse words and word smith.
This is unreal. Although this is a "congressional research study" and not official gov't talking points, it is clear that people are making sh!t up as they go along.(and advising these congressional researchers) It appears that the administration's lawyers may say that they didn't mean that the sr. pref couldn't be repaid. The sentences near the end of the summary on page two:
Under terms of the federal government’s support agreement as amended and effective on August 17, 2012, the enterprises will pay the Treasury all of their quarterly profits (if any). Under the
previous agreements, the enterprises paid Treasury dividends of nearly $20 billion annually (10% of the support). Paying the federal government all profits earned in a quarter could prevent the
GSEs from accumulating funds to redeem the senior preferred stock. However, it would appear that the GSEs could make quarterly redemptions.
What!!!! "However, it would appear that the GSEs could make quarterly redemptions."
http://www.fas.org/sgp/crs/misc/R42760.pdf
you can't make this sh1t up. I remember Clinton asking what the definition of "is" is..... Lawyers. Gotta love em.
Great find, Georgenips.
clearly, the pendulum is swinging between Merrill, this and the court action(along with Reid and the goofy guy on the east coast with the sensible plan)
The writing is on the wall. Once the hedgies see this, the real movement will start.
I am also well aware that one of you guys noticed the possible loophole in the poorly written language. Apparently, the other attorneys saw the language as a loophole, too. I honestly thought that it was bogus... (the possible loophole brought up by a board member out here) But heck, the 401k was started by a loophole. why not full redemptions of the sr. preferreds?
this also makes it obvious that people who research this stuff do go to message boards for some of the information. no doubt in my mind, now. This board is not perfect but there are a heck of a lot of free floating ideas. Some are solid, others not so much. on the whole, this is a very sharp group. this may be resolved much quicker than any can imagine.
I am going to go dark and stop posting every day(or every other) I just don't want to say something wrong that can get misconstrued. I may respond to technical/operational questions on stuff. I probably won't post at all until something happens. I guarantee you tons of other people watch this board like I have for years and have things they can contribute but just choose to rarely say anything.
FNMAT- no clue why the premium- it also has decent volume
It was issued in may 2008. there is significantly more litigation remedies(if every other remedy fails) here given Paulson's statements, the timing of what happened and who knew what and when.
IPO - 5/13/2008 - 80.00 Million Shares @ $25.00/share.
http://www.quantumonline.com/search.cfm
My opinion on why it trades at a premium. Not a reco or anything else of the sort.
"It was interesting that he used the term net zero."
know that what was written was chreographed. every word/phrase vetted by attnys, Board of dir and likely treasury......
Freddie's CFO gave the hint
As a PS to my post in re c-ship ending as we approach net-zero, leaving GSEs on "solid-financial footing" with many qtrs of profits behind them.
Interesting. Very, very, very interesting..... Best post I have seen in over a year. I have seen a ton of good posts.
no problem.
I am looking to change my brokerage account and was wondering which one people like the best? I would like to be able to put in if I sell X shares then buy Y shares. Is that even possible?
I think that is called a "conditional order". I think Ameritrade has that. I have heard Ameritrade is good, too.(If you are just looking to trade. I honestly didn't know that any OTC stocks allowed stops. I thought that was up to the market maker and had never seen stops with them. Stops never seem to work out. Better to just watch it all day and pull the trigger(mental stop) sounds crazy but it has worked to save me money on super spec stuff that I needed to stop out of....
as always, you are a good writer. you don't need to change anything. The one thing I haven't seen from any person writing is this.... The argument for/against a wind up/wind down of a profitable company either thru R-ship or congressional action and while that may have been an option in 2008/early 2009, why it may or may not be viable now. How there are rules to r-ship and the courts and arguments why they should/shouldn't be followed. About how the longer this goes, the more unlikely that r-ship or a wind-down without a 5th amendment nod (via capital expended) happens. How the dems and republicans aren't likely to agree on the path forward. How that now they are profitable(and now that they are potentially capable in a week to raise 200 billion thru reverse splits and a capital raise to pay things back with Treasury's ok like AIG) it is improbable that the shares can be cancelled without a tender or other remedies. (or why that is not possible)
I know it is a ton of junk I typed... The main thing is "how do you wind down a profitable company and leave anyone in the lurch whether little banks, ind investors, hedge funds, etc?"
also.... this isn't an endorsement of freddie/fannie or anything else, just asking for one of the two writers to write on r-ship/wind down.